Copper Concentrate TCs Rose amid Weak Demand From Smelters

As of last Friday April 14, the SMM Imported Copper Concentrate Index (weekly) stood at $82.66/mt, $0.9/mt higher than the previous week. During the week, the spot trading activities of traders and smelters were muted, and the actual spot transactions were limited. The traded TCs of seaborne clean ore scheduled for the shipment in the second quarter between mines and traders stood at $71-72/mt, and those between traders and smelters stood at $83-84/mt. There were large numbers of offers from traders, standing between $79-82/mt. The price coefficient of Cu 20% domestic ore stood at 88.5-89.5%.

According to foreign media reports, a string of mergers and acquisitions will increase the consolidation of copper mines. Newmont Mining is preparing to acquire Newcrest Mining for an estimated A$29.4 billion ($19.54 billion). Glencore added $8.2 billion to its initial $23 billion bid for Teck Resources, but Teck said last Thursday it had rejected Glencore's latest offer. Last Thursday, Hudbay Minerals announced that it will acquire Copper Mountain Mining with an equity purchase equivalent to $439 million to expand its copper metal business. Each common share of Copper Mountain will be exchanged for 0.381 common shares of Hudbay. The transaction is expected to close by the end of the second quarter or at the start of the third quarter of 2023. BHP's takeover offer for Oz Minerals has been backed by the Oz Minerals shareholders, and BHP will acquire the Australian mining company Oz Minerals for A$9.6 billion ($6.4 billion).

SMM believes that TCs of imported copper concentrate will continue to rise in the second quarter. The buyers have obtained more power over pricing, and inquiries by some smelters have reached $78-90/mt.

Chinese smelters, including China Daye Non-Ferrous Metals, Xinjiang Wuxin Copper Industry, Jiangxi Copper Headquarters, Tongling Jinguan, and Qinghai Copper, will undertake concentrated maintenance in late March or April. This will weaken the demand for spot copper concentrate. Meanwhile, port capacity in America will continue to recover. The disruption at overseas mines has eased and Quebrada Blanca Phase 2 in Chile has been commissioned, growing supply.

The inventory of copper concentrate at five Chinese ports was 628,700 mt in the week ending April 14, a growth of 37,700 mt from a week earlier.